Woes of country mounting with bailout delay, Sri Lanka tells international forum

14 January 2023 12:32 am Views - 6788

 

• Says delays in approval are taking a heavy toll on people of Sri Lanka
• Shares some progress is achieved but delay in gaining financial assurances is holding deal
• Points out that while waiting SL is focusing on financing socio-economic infrastructures and public utility supply

As Sri Lanka continues to face delays in securing the much sought-after bailout from the International Monetary Fund (IMF), the government admitted this week that the situation is becoming increasingly difficult for the people of the country.

State Minister of Finance Shehan Semasinghe told an international forum on Thursday that while all is on track to firm up the relief package, the current economic crisis is impacting individuals and businesses in the island nation. “.… we are confident of securing the approvals with the assistance of our partners. However, this uncertainty surrounding technical concerns and the delay in the vital approval is taking a heavy toll on the people of Sri Lanka,” said Semasinghe.

He made his comments while addressing the Voice of Global South Summit of the G20 Finance Ministers that was held virtually.

He went on to assure the regional peers that progress has been achieved in the negotiations with the IMF but financial assurances are yet to be sought from bilateral partners.

Sri Lanka has already initiated discussions with India and China on gaining financial assurances as soon as possible.

 While on the face all seem to be on track to reduce Sri Lanka’s hardships, the IMF is firm about not releasing the bailout package until the island nation reaches an agreement with India and China, in reducing its debt. The Central Bank made a fresh appeal in this regard earlier this week. While the painful wait continues, the Sri Lankan government is focusing on financing important socio-economic infrastructures and public utility supply, which are imperative to ease the mounting burden carried by individuals and businesses.  

Further, Semasinghe stressed the need for having a well-coordinated planning and budgeting framework, which is key for making public investments in the country. He noted that the proposed framework would carefully examine and enable a realistic assessment of investments that are identified for implementation, particularly when using borrowed funds.